Our analysts consider the impact of material environmental, social and governance factors on the value of our investments. These analyses are essential when assessing the merits of investing in a company.
We incorporate both financial and non-financial factors, including environmental, social and governance (ESG) considerations, into our investment process. Our investment team continually monitors developments on the regulatory, political and technological fronts to gauge the economic impact to our companies from environmental factors, such as climate change. Socially, we monitor how well a company is positioned to retain key talent, manage supply chain risk, and outperform local product safety and quality regulations, among other metrics. In all companies in which we invest, we seek robust corporate governance practices. This full mosaic of information is used to assess the quality of a business and its ability to sustain per share value growth over the long term.
For more than 40 years, Harris Associates has developed a strong reputation as a long-term, shareholder-oriented investment firm. This approach is a byproduct of our value investment philosophy that requires every investment to meet the following criteria: 1) they are companies that we believe are priced at significant discounts to our estimate of the company’s intrinsic value, 2) they are companies that have a path to grow per share value and 3) they are companies that are run by managers who think and act as owners.
We are continuously learning and advancing our understanding of ESG topics and trends. Our goal is to continue to improve our ability to recognize, evaluate and act on ESG opportunities and risks to stay ahead of the curve.
All material risks and opportunities must be factored into our intrinsic values. We believe it’s not only the responsible thing to do, but it’s required to thoroughly analyze the sustainability of a business.Daniel Nicholas, Client Portfolio Manager